GENERAL INFORMATION FOR FILING FORM 531, …

1 1 CAPITAL TAX COLLECTION BUREAU (CTCB) GENERAL & LINE BY LINE INSTRUCTIONS FOR FILING form 531 ONLINE - LOCAL EARNED INCOME TAX (EIT) RETURN NOTE: THESE INSTRUCTIONS CONTAIN THREE PARTS: THE FIRST PART IS GENERAL INSTRUCTIONS FOR ALL FILERS, THE SECOND PART IS FOR THOSE WHO ARE FILING THE SHORT form ONLINE AND THE THIRD PART IS FOR THOSE WHO ARE FILING THE LONG form ONLINE ALTHOUGH THE GENERAL INSTRUTIONS APPLY TO EVERYONE, PLEASE ONLY FOLLOW EITHER THE SHORT form INSTRUCTIONS OR LONG form INSTRUCTIONS DEPENDING THE form YOU ARE FILING ** GENERAL INSTRUCTIONS FILING DEADLINE - April 15th of the succeeding year for which this return is filed; or, for fiscal year returns, the 15th day of the 4th month following the close of the taxable year. If the normal FILING due date falls on a Saturday, Sunday or legal holiday, the FILING date will be extended to the next business day. WHO MUST FILE - Any resident of a "MEMBER MUNICIPALITY AND/OR SCHOOL DISTRICT" -- for all or part of the tax year, who has taxable net profits and/or earnings, even if no tax is due.

2 Go to and click on the members tab to view all the member municipalities and school districts of Capital Tax Collection Bureau (CTCB). IMPORTANT NOTE FOR PAXTANG BOROUGH, PENBROOK BOROUGH AND WEST HANOVER TOWNSHIP RESIDENTS: The Capital Tax Collection Bureau only collects the Earned Income Tax (EIT) for the above-mentioned municipalities. CTCB is no longer the EIT collector for the Central Dauphin School district. The school district has selected Berkheimer Tax Collector (Berkheimer) to collect their EIT. IMPORTANT NOTE FOR DICKINSON TOWNSHIP, MOUNT HOLLY SPRINGS BOROUGH, NORTH MIDDLETON TOWNSHIP AND SOUTH MIDDLETON SCHOOL DISTRICT: CTCB only collects the Earned Income Tax (EIT) for the South Middleton and Carlisle Area School Districts. CTCB is no longer the EIT collector for Dickinson Township, Mount Holly Springs Borough, North Middleton Township and South Middleton Township.

3 Those four municipalities have selected Central Tax Bureau of Pa., Inc. (CENTAX) to collect their EIT. Residents of those seven municipalities must file 2 separate annual local EIT tax returns for tax year 2009: one for the School District and one for the Municipality. NOTE: RESIDENTS OF THE ABOVE-LISTED MUNICIPALIITES CAN AND ARE ENCOURAGED TO FILE ONLINE THIS YEAR!!!!!!! IF YOU HAD NO TAXABLE EARNINGS, enter INFORMATION on the Taxpayer INFORMATION page by selecting the correct status (Student, Unemployed, Retired or Deceased) along with the proper date INFORMATION . You will need to complete the address screen and once you accept the address you may proceed to the Summary Screen and submit the return with all zeros. EFFECTIVE DATES FOR THIS TAX - This return covers the taxable period from January 1 through December 31 of the year listed on the return (or portion thereof for a prorated return), or any fiscal tax year so designated by the taxpayer.

4 TAXABLE INCOME ITEMS - Taxable items include: wages, salaries, commissions, bonuses, tips, fees, net profits, severance pay, reserve unit, National Guard and other military inactive duty pay, premature retirement or other payment plan distributions for reasons other than death or disability not rolled over into another federally qualified retirement plan to the extent they do not represent a return of an employee s previously taxed contribution. Cafeteria plan contributions are non-taxable to the extent they are not taxed for federal income tax purposes and they would be exempt from PA income taxation if paid by the employer. Employee contributions to 401(k), 403(b), 457 and other types of deferred payment programs remain taxable items. Incentive payments ( , income from employee stock options and phantom stock plans), reimbursement of non-deductible expenses, a fair salary commensurate with the service provided by an S-Corp shareholder to the corporation, fellowships (when compensation for services) remain taxable.

5 TAXABLE RETIREMENT/SAVINGS PLAN DISTRIBUTIONS - CTCB follows the Pennsylvania Department of Revenue's Personal Income Tax Regulations regarding the taxability of distributions from employee deferred payment programs such as pensions (retirement plans), profit sharing, ESOP, SEP, 401(k), 403(b) and 457 plans. If a distribution of this type is taxable at the state level, a portion of it may be taxable at the local level. A distribution of such a plan can be made up of three ingredients: 1) the employee's previously taxed contributions; 2) the employer's untaxed contributions; and 3) income generated by the plan's assets. The Commonwealth of Pennsylvania and CTCB tax item numbers 2 & 3 (employer contributions and income). If the plan is unfunded, however, any distribution is an employer's contribution and it is entirely taxable. The taxpayer must provide a statement from the plan 2administrator or trustee of the account showing what portion, if any, of the distribution is attributable to the employer's contribution and income generated by the plan s assets.

6 This is the portion that is taxable for earned income tax purposes and must be listed on your one return. NON-TAXABLE ITEMS - Interest, dividends, workmen s compensation, subchapter "S" income (except a fair salary commensurate with the services provided by an S-Corp shareholder to the corporation), passive schedule income, cafeteria plan contributions to the extent they are not taxed for federal income tax purposes and they would be exempt from Pennsylvania income taxation if paid by the employer, social security benefits, pensions, annuities, and retirement pay received after retirement from employment and upon reaching a specific age or years of service or upon death or disability, IRA benefits other than premature distributions, disability benefits, third party sick pay, capital gains, death benefits, life insurance proceeds, gifts or bequests, public assistance, unemployment compensation, active military service pay or bonuses (does not include reserve unit and National Guard inactive duty pay which is taxable), income from trusts, rental income (unless the operation is a business)

7 , clergy housing allowance, and personal use of employer s owned or leased property. IF YOU MOVED and you lived in different municipalities, falling under different tax bureau jurisdictions during the year, you must prorate your earnings accordingly and file with the appropriate tax bureaus. When FILING online, please enter all appropriate moving and work dates when requested; this will provide INFORMATION for the system to prorate the return. If you need assistance with this, please contact our office. IF YOU RECEIVED MORE THAN ONE TAX RETURN, please return both tax returns to CTCB. Write your correct social security on each return and mark each return RECEIVED 2 RETURNS . IF YOU ARE SELF-EMPLOYED OR YOUR EMPLOYER DOES NOT WITHHOLD EIT TAXES OR DOES NOT WITHHOLD THE CORRECT AMOUNT OF TAX, you may be required to pay the tax quarterly to our bureau on form 521. If you do not receive form 521 by April 1st, please request it from our bureau.

8 Failure to comply will subject you to interest, penalty and possibly a fine and costs. LOCAL FILING COMPARED TO PA PERSONAL INCOME TAX RETURN - CTCB participates in a program with the Pennsylvania Department of Revenue to match compensation and net profit/loss as reported on the local return against the same items reported on the state return. If, by audit, tax items are changed by either the IRS or State Income Tax Bureau that have a bearing on your local tax return, you must file an amended local return to reflect such changes. If you have subchapter "S" corporation income, please mail a copy of your federal Schedule K-1 ( form 1120S) to CTCB. The reporting of this is for INFORMATION purposes only you will not be taxed on these amounts. This INFORMATION will prevent CTCB from sending you a "discrepancy" letter when your local and state income does not match due to this tax item. NOTIFICATION OF AVAILABILITY OF DISCLOSURE STATEMENT FOR LOCAL TAXPAYER BILL OF RIGHTS - You are entitled to receive a written explanation of your rights with regard to the audit, appeal, enforcement, refund and collection of local taxes by calling Capital Tax Collection Bureau's Harrisburg Division at (717) 234-3217 during the hours of 8 - 4 , Monday through Thursday and 8:30 - 4 , Friday.

9 ** LINE BY LINE INSTRUCTIONS SHORT VERSION OF ONLINE FILING FOR FUTHER HELP, CLICK ON THE QUESTION MARK NEXT TO EACH QUESTION! Sign-in Screen - Enter your social security number and your personal identification number ( PIN ) in the boxes as indicated. The PIN is case sensitive. If you do not have a PIN, you will need to contact CTCB and you will not be able to continue at this time. Long form or Short form - Based on your situation, you will either select the long form or short form option. Read the criteria listed on the page to help you determine which form you should choose. Personal INFORMATION Screen Question 1: If you would like to file a combined return with your spouse, click yes . Question 2: If this is an amended return, click yes . If this is an amended return, please fill in the box explaining why you are FILING an amended return. Enter all personal INFORMATION for you (and your spouse if FILING a combined return).

10 If you (or your spouse if FILING a combined returned) were a student, unemployed, retired or are completing this return for a deceased individual, please indicate so and enter the dates as requested. Address Screen House number Enter the house number only. Do not enter any other address INFORMATION on this line. Direction If your street address contains a direction, use the drop down menu to insert the proper direction. Street name Enter only the name but not the street suffix. For instance Smith Street should only be entered as Smith Street Suffix Use the drop down menu to add your street suffix such as DR , ST , CIR , AVE etc. County, School District and Municipality Use the drop down menu to enter the proper INFORMATION for where you reside. Residency Summary Review the INFORMATION listed on this page and if you need to make and changes click on the Edit button.